Ethereum's Price Drop Below $2,400 Could Trigger $1.12B Liquidation

According to recent data, if the price of Ethereum falls below $2,400, the cumulative long liquidation pressure on mainstream centralized exchanges (CEXs) will reach $1.12 billion. This significant figure highlights the potential market impact if Ethereum's price were to drop to this level. The liquidation pressure is a measure of the strength of liquidation clusters, indicating the relative importance of each liquidation point compared to adjacent points. A higher liquidation bar suggests that reaching a certain price point will trigger a more intense reaction due to the liquidity shock.

Conversely, if Ethereum's price rises above $2,600, the cumulative short liquidation pressure on mainstream CEXs will reach $818 million. This scenario underscores the potential for substantial market movements in either direction, depending on Ethereum's price trajectory. It is important to note that the liquidation chart does not provide the exact number of contracts to be liquidated or their precise value. Instead, it illustrates the relative strength of liquidation clusters, offering insights into how price movements might affect market dynamics.

The liquidation chart serves as a valuable tool for understanding the potential impact of price changes on the market. A higher liquidation bar indicates that reaching a specific price point will generate a more intense reaction due to the liquidity shock. This information is crucial for traders and investors who need to anticipate market movements and adjust their strategies accordingly. The data emphasizes the importance of monitoring Ethereum's price closely, as significant liquidation pressures could lead to substantial market volatility.

Ask Aime: Can Ethereum's price drop below $2,400 trigger a liquidity shock worth $1.12 billion?